Speed of PTAB Fuels Criticism of Initial Trial Results

By Scott McKeown on April 22, 2014

Critics Ignore Long Standing Realities

Critics of the Patent Trial & Appeal Board (PTAB) are out in force decrying the work of the PTAB as anti-patent. This criticism flows from the unfavorable outcomes of the 30 or so concluded Inter Partes Review (IPR) and Covered Business Method (CBM) proceedings to date. That is, some consider the heavy number of claim cancellation decisions as evidence of a bias against patentees. Nothing could be further from the truth.

First, patents now being asserted were drafted to survive district court scrutiny. As is well known, when in court, patentees benefit from a clear and convincing evidentiary standard, a presumption of patent validity, and a non-technical audience. Due to the significant obstacles of demonstrating invalidity before a court, infringement concerns have been the primary driver of patent procurement practices to date. For this reason patents are routinely procured to obtain the broadest possible claim scope for the purpose of ensnaring infringers; often times overly broad.

On the other hand, the PTAB counteracts each one of the district court invalidity benefits. The PTAB employs the more liberal preponderance of evidence standard for demonstrating unpatentability, no presumption of patent validity, and utilizes technical decision makers. An unpatentability finding of the PTAB is now a significant obstacle to patent monetization. Indeed, well over a decade of inter partes reexamination statistics demonstrate that 92% of the time patent claims are cancelled or amended in such administrative challenges. As can be appreciated, Patentees must recalibrate their prosecution and procurement practices to survive PTAB scrutiny.

Clearly such challenger friendly results are nothing new for the USPTO (or to anyone that has practiced before the PTAB). So, why are the more recent PTAB statistics causing such controversy?

Simple….SPEED

Inter partes reexamination proceedings simply could not conclude in time to matter for most patent disputes. That is, even if a patent ultimately fell in reexamination, the final result was 5-7 years away from the time of filing. That kind of delayed result disrupted very few patent assertion campaigns. For example, the NTP portfolio was ultimately gutted in patent reexamination, but that was years after RIM had paid the now infamous $612 million dollar settlement. Since passage of the America Invents Act (AIA), however, relief can be had within months with the right PTAB claim construction, and as little as 2 years otherwise.

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